Japan Industrial Output Falls 1.7% In November

12/27/2012 9:02 PM ET

Industrial production in Japan fell a seasonally adjusted 1.7 percent on month in November, the Ministry of Economy, Trade and Industry said in Friday's preliminary reading - reversing the previous month's gains.

The headline figure was well below forecasts for a decline of 0.5 percent following the 1.6 percent increase in October.

On a yearly basis, industrial production dropped 5.8 percent - also missing forecasts for a fall of 4.6 percent after losing 4.5 percent in the previous month.

Upon the release of the data, the METI maintained its assessment of industrial production, saying: "Industrial production is on a downward trend."

Industries that contributed to the decline in November include general machinery, fabricated metals and electronics equipment. Commodities that contributed to the decline include cellular phones, transmission parts and steel bridges.

According to the survey of production forecast in manufacturing, production is expected to jump 7.5 percent in December and 2.4 percent in January.

Industries that contribute to the rise in December include electronic parts, transport equipment and general machinery. Industries that mark the increase in January include transport equipment, electronic equipment and others.

Shipments were down 1.1 percent on month in November dipping for the third straight month. They were also down 5.9 percent on year, thanks to a decline in general machinery, communications equipment and fabricated metals.

Inventories were down 1.2 percent on month, falling for the fourth straight month. They were also up 3.1 percent on year despite losses among petroleum products, communications equipment and iron and steel.

The inventory ratio was down 0.3 percent on month in November, falling for the second straight month. It was also up 10.0 percent on year.

Also on Friday:

• Core consumer prices in Japan were down 0.1 percent on an annual basis in November, the Ministry of Internal Affairs and Communications said - matching forecasts following the flat reading in October.

Overall nationwide consumer prices were down 0.2 percent on year, also in line with forecasts following the 0.4 percent decline in the previous month. On a monthly basis, core CPI was down 0.3 percent and overall inflation dipped 0.4 percent.

Core consumer prices for the Tokyo region - considered a leading indicator for the nationwide trend - were down 0.5 percent on year in December. That matched forecasts and was unchanged from November.

Overall Tokyo inflation also was down an annual 0.6 percent, in line with expectations following the 0.5 percent fall in the previous month. On a monthly basis, overall Tokyo CPI was flat and core CPI dipped 0.2 percent.

• The unemployment rate in Japan was a seasonally adjusted 4.1 percent in November, the Ministry of Internal Affairs and Communications said. That beat forecasts for 4.2 percent, which would have been unchanged from the previous month.

The participation rate was 59.1 percent, matching expectations and down from 59.4 percent in October.

The number of employed persons in November was 62.97 million, down 60,000 or 0.1 percent from the previous year. The number of unemployed persons in November was 2.60 million, down 210,000 or 7.5 percent from the previous year.

• Average household spending in Japan was up 0.2 percent on year in November, the Ministry of Internal Affairs and Communications said, standing at 273,772 yen. That was well shy of forecasts for an increase of 0.7 percent following the 0.1 percent contraction in October.

The average of monthly income for workers' household was up 2.1 percent on year to 432,681 yen, while consumption expenditures added an annual 1.8 percent to 300,181 yen.

• Retail sales in Japan were up 1.3 percent on year in November, the Ministry of Economy, Trade and Industry said, standing at 11.086 trillion yen. That beat forecasts for a gain of 1.1 percent following the 1.2 percent contraction in October.

Sales from large retailers were up 0.9 percent on year to 1.664 trillion yen - well above expectations for a contraction of 0.4 percent after plunging 3.2 percent in the previous month.

The data also showed that commercial sales were down an annual 0.8 percent to 41.450 trillion yen, while wholesale sales dropped 1.5 percent to 30.364 trillion yen.

• The Nomura/JMMA Manufacturing Purchasing Managers' Index saw a score of 45.0 in December, dipping from 46.5 in November. A score below 50 signals contraction in a sector, while a score above 50 means expansion.

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